CCI to clear 90% M&A deals within 60 days

New Delhi, Dec 30 | Updated: Dec 31 2007, 05:05am hrs

Alarmed by the growing criticism of the Competition Commission, government has said that 90% of merger and acquisition deals would be cleared by it within two months as against 210 days provided in the Act.

"We are determined to address the concerns of the industry regarding possible delay in clearing of M&A deals by the Commission. Through rules and regulations, we will ensure that about 90% of the deals are cleared within two months," a senior corporate affairs ministry official said.

He said only in 5-10% of the cases, CCI that will become fully operational in the next 6-8 months, would require additional time to investigate the anti-competitive practices in the larger economic interests of the country.

Earlier, the industry chambers expressed fears that recent amendment to the Competition Act would impede M&As that play a key role in helping attain a scale to match international competition. The current provisions of the competition law will kill all M&A deals, hamper FDI inflow and affect the growth of economy in general, FICCI had said.

Confederation of Indian Industry has also said that any law that restricted the present status would result in loss of transactions, deny the opportunities for absorption of advanced technologies and impede growth.

The new Act makes it mandatory for companies to seek prior approval from regulatory authorities before going in for any M&A, which can take up to seven months. The official disclosed that government could also introduce a threshold limit, of say Rs 1,000-3,000 crore turnover, where the deal would get approval within 30 days.

He maintained that like other developed countries, the objective of CCI is to check the monopolistic and restrictive trade practices followed by certain industries through illegal tie ups and M&As.